Chinese Hackers Infiltrate New York Times Computers(nytimes.com)

  U.S. Groups Helped Nurture Arab Uprisings

  Even as the United States poured billions of dollars into 
  foreign military programs and anti-terrorism campaigns, a 
  small core of American government-financed organizations 
  were promoting democracy in authoritarian Arab states. ...

  The United States’ democracy-building campaigns played a 
  bigger role in fomenting protests than was previously 
  known, with key leaders of the movements having been 
  trained by the Americans in campaigning, organizing through 
  new media tools and monitoring elections. ...

  Today the work of these groups is among the reasons that 
  governments in turmoil claim that Western meddling was 
  behind the uprisings, with some officials noting that 
  leaders like Ms. Qadhi were trained and financed by the 
  United States. Diplomatic cables report how American 
  officials frequently assured skeptical governments that the 
  training was aimed at reform, not promoting revolutions.

  Is China Next?

  Over the course of three short months, popular uprisings 
  have toppled regimes in Tunisia and Egypt, sparked a civil 
  war in Libya and created unrest in other parts of the 
  Middle East. They also have raised a question in many 
  people's minds: Are all authoritarian regimes now 
  threatened by this new democratic wave? In particular, is 
  China, a rising superpower, vulnerable to these forces?

  They operate from a bare apartment on a Chinese island.
  They are intelligent 20-somethings who seem harmless.
  But they are hard-core hackers who claim to have gained
  access to the world's most sensitive sites, including 
  the Pentagon.

  In fact, they say they are sometimes paid secretly by the
  Chinese government -- a claim the Beijing government
  denies.

  "No Web site is one hundred percent safe. There are Web
  sites with high-level security, but there is always a
  weakness," says Xiao Chen, the leader of this group.

  "Xiao Chen" is his online name. Along with his two
  colleagues, he does not want to reveal his true identity.
  The three belong to what some Western experts say is a
  civilian cyber militia in China, launching attacks on
  government and private Web sites around the world.

  If there is a profile of a cyber hacker, these three are   
  straight from central casting -- young and thin, with skin
  pale from spending too many long nights in front of a
  computer.

  One hacker says he is a former computer operator in the
  People's Liberation Army; another is a marketing graduate;
  and Xiao Chen says he is a self-taught programmer.

  "First, you must know about the Web site you want to
  attack. You must know what program it is written with,"
  says Xiao Chen. "There is a saying, 'Know about both
  yourself and the enemy, and you will be invincible.'"

  CNN decided to withhold the address of these hackers' Web
  site, but Xiao Chen says it has been operating for more
  than three years, with 10,000 registered users. The site
  offers tools, articles, news and flash tutorials about
  hacking.

  Private computer experts in the United States from
  iDefense Security Intelligence, which provides
  cybersecurity advice to governments and Fortune 500
  companies, say the group's site "appears to be an
  important site in the broader Chinese hacking community."

  Arranging a meeting with the hackers took weeks of on-
  again, off-again e-mail exchanges. When they finally
  agreed, CNN was told to meet them on the island of
  Zhoushan, just south of Shanghai and a major port for
  China's navy.

  The apartment has cement floors and almost no furniture.
  What they do have are three of the latest computers. They 
  are cautious when it comes to naming the Web sites they
  have hacked.

  On camera, Xiao Chen denies knowing anyone who has
  targetted U.S. government Web sites. But off-camera, in
  conversations over three days, he claims two of his
  colleagues -- not the ones with him in the room -- hacked
  into the Pentagon and downloaded information, although he
  wouldn't specify what was gleaned. CNN has no way to
  confirm if his claim is true.

  "They would not publicize this," he says of someone who
  hacks the U.S. Defense Department. "It is very sensitive."

  This week, the Pentagon said computer networks in the
  United States, Germany, Britain and France were hit last
  year by what they call "multiple intrusions," many of them
  originating from China.

  At a congressional hearing in Washington last week,
  administration officials testified that the government's 
  cyber initiative has fallen far short of what is required.
  Most alarming, the officials said, there has never been a
  full damage assessment of federal agency networks.

  "We are here today because we must do more," said Robert
  Jamison, a top official in the U.S. Department of Homeland
  Security. "Defending the federal system in its current
  configuration is a significant challenge."

  U.S. officials have been cautious not to directly accuse
  the Chinese military or its government of hacking into its
  network.

  But David Sedney, the deputy assistant secretary of
  defense for East Asia, says, "The way these intrusions are
  conducted are certainly consistent with what you would
  need if you were going to actually carry out cyber
  warfare."

  Beijing hit back at that, denying such an allegation and   
  calling on the United States to provide proof. "If they
  have any evidence, I hope they would provide it. Then, we
  can cooperate on this issue," Qin Gang, a spokesman for
  the Chinese Foreign Ministry, said during a regular press
  briefing this week.

  But again off-camera, Xiao Chen says after the alleged
  Pentagon attack, his colleagues were paid by the Chinese
  government. CNN has no way to independently confirm if
  that is true.

  His allegations brought strenuous denials from Beijing. "I
  am telling you honestly, the Chinese government does not
  do such a thing," Qin said.

  But if Xiao Chen is telling the truth, it appears his
  colleagues launched a freelance attack -- not initiated by
  Beijing, but paid for after the fact. "These hacker groups
  in my opinion are not agents of the Chinese state," says
  James Mulvenon from the Center for Intelligence Research
  and Analysis, which works with the U.S. intelligence
  community.

  "They are sort of useful idiots for the Beijing regime."

  He adds, "These young hackers are tolerated by the regime
  provided that they do not conduct attacks inside of
  China."

  One of the biggest problems experts say is trying to prove
  where a cyber attack originates from, and that they say
  allows hackers like Xiao Chen to operate in a virtual
  world of deniability.

  And across China, there could be thousands just like him,
  all trying to prove themselves against some of the most
  secure Web sites in the world.